Area construction permits drop office sector is particularly low

August 27, 1991|By David Conn

Cautious lenders, stagnant personal income and high office vacancy rates are the causes of the continuing slowdown in both residential and non-residential building activity in the Baltimore area, according to regional economists.

In July, only 850 residential building permits were issued in the Baltimore area, a 9 percent decrease from the level of July 1990, the Baltimore Regional Council of Governments reported yesterday. It was the lowest number for a July since 1982 and 50 percent below the average July from 1983 to 1990.

For the first seven months of the year, 30 percent fewer residential See PERMITS, 6D, Col. 1PERMITS, from 1Dpermits were issued than during the same period last year, the council reported. Only in Harford and Anne Arundel counties was residential building activity higher last month than in July 1990.

Non-residential building activity fell even more, according to the council. In July, the dollar value of non-residential building projects for which permits issued in the region fell to $11.7 million, a decline of 77 percent from the level of July 1990 and the lowest July total since 1980. For the first seven months of the year, the $205.3 million in non-residential permits was 28 percent below 1990 figures.

"To me, [the report] indicates that we haven't yet pulled out of a construction downturn that's been evident over the past year or so, both in residential and non-residential activity," said Mark Goldstein, an economist with the regional council.

Mr. Goldstein said that the office sector continued to be the hardest hit of the non-residential building categories. Through July, only $22 million in office construction permits were issued in the region, which would amount to $37.7 million for the full year if activity continues at the same pace for the rest the year. Last year, the value of non-residential office permits was $143 million, Mr. Goldstein said, and the average for 1984 through 1988 was $251 million a year.

Only in Harford County was non-residential activity higher through July than in the same part of last year, the council reported, and $50 million of the $67 million in activity came from the Clorox Corp.'s bleach manufacturing plant in Perryman.

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